Knoxville has shown incredible growth and durability over the past several years, now consistently ranking as one of the best-performing multifamily markets in the country. As many national markets are beginning to become stagnant, multifamily rent growth in Knoxville continues, largely driven by record-breaking enrollment at UT Knoxville. Rents rose 9.6% in June 2023, exponentially larger than the national average of 2.3%. Even with the increase in rents, occupancy remains high as the MSA average is 95%, showing that demand is still immensely high in this competitive market.
In 2023, Knoxville is expected to deliver around 2,090 units, and 3,126 units are currently under construction. Even though total units will increase, the multifamily market is anticipated to flourish due to rising mortgage rates, a decline in single-family home sales as many people have locked in low interest rates, a growing job force, and the University of Tennessee-Knoxville continuing to expand and assert its presence. Additionally, attractive tax incentives and quality of life will continue to attract people and businesses to the Knoxville area.
The Knoxville MSA is largely driven by the Healthcare, Education, Energy, and Research industries as some of the area’s largest employers include Covenant Health, The University of Tennessee-Knoxville, Y-12 National Security Complex, Oak Ridge National Laboratory, and University of Tennessee Medical Center. During 2022 alone, 20,400 jobs were created, which grew overall employment in the region by 4.9%.